Financing Your Education

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Financing Your Education
A partnership between Government, School and
Family.
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2
Government

• Government Aid Regulations
• The Government works to determine
• overall aid
• Aid regulations apply to all schools
• Your eligibility for aid is established by
• the government

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3
School

• Institutional Assistance
• Depends upon funding at school
• School sets eligibility requirements
• Varies from school to school
• High cost schools have more institutional
• assistance

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4
Family
Expected Family Contribution Your expected
family contribution or EFC is established by the
federal processor. Your EFC is the amount of
money you and your parents can be expected to
contribute to your college costs each year.
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5
FAFSA
Apply Eligibility for aid is determined based
upon your FAFSA (Free Application for Federal
Student Aid). The FAFSA becomes available
January 1 of each year. Download or complete
the FAFSA on the Web at www.fafsa.ed.gov, pick
one up at your high school, college or library,
or call 1-800-4-FED-AID.
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For FAFSA tips and tools visit
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FAFSA
Verification About 1 in 3 FAFSAs are picked by
the government for verification. When this
happens, you must supply additional information
as requested. The information should be
submitted to your prospective college as soon as
possible to prevent delays in your aid.
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7
NEED
Definition of Need Your financial need varies
based on the cost of attendance. Need is the
cost of attendance minus your expected family
contribution (EFC).
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8
Need

• Demonstration of Need
• Establish Cost - Use FastWebs Cost Calculators
• to figure out the cost of
• - Tuition and Fees - Books and Supplies
• - Room and Board - Personal and
  Transportation Costs
• Determine Family Contributions (EFC)
• - To get an early estimate of your EFC, use the
  Financial Aid
• Estimation Calculator at www.finaid.org
• Evaluate Other Resources
• - Scholarships
• - Benefits
• - High School Awards

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School Meets Need

• Schools May Offer
• Grants (gift assistance - do not need to be paid
  back)
• Pell
• Supplemental
• Tuition
• Talent Incentive
• Federal Private Loans (must be repaid)
• Stafford (subsidized and unsubsidized)
• Perkins
• PLUS (parents)
• Jobs (employment opportunities)
• Scholarships (institutional private)

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Borrowing
Warning Students can get hooked into a lot of
borrowing for an education students and parents
can help keep borrowing to a minimum. Cut Costs
by Curbing Expenses - Take advantage of campus
activities - Seek out used
textbooks - Exercise credit card restraint
- Minimize excess travel - Carpool or take a
bus when going back home - Keep phone calls
minimal - Go with the basics in fashion-they
wont go out of style Manage Money Wisely - Make
a budget and stick to it Be a Student
WorkerStudent workers typically do better in
their studies - Earn and save as much as possible
from a summer job - Work part-time while in
school
Consider Alternative Sources of Aid . . .
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Scholarships

• Use the Internet to find scholarship
  opportunities
• FastWeb www.fastweb.com
• Over 600,000 scholarships listed
• 1 billion dollars in aid available
• Free
• On-line applications
• Expert Advice
• E-mail updates when new awards become available
• Help and How-tos
• Printable information request letters

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Scholarships

• Scam Warning Signs Beware of all companies that
  do any of the following
• Require a fee of any kind
• Refuse to release their telephone number and
  
• provide only a P.O. Box where you can mail your
  
• check
• Offer an award for which you did not apply
• Promise to do all the work for the student
  
  
• More...

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Scholarships

• Scam Warning Signs (continued)
• Guarantees you will win an award
• Claim that you cannot get the information they
  
• supply anywhere else
• Require personal financial information such as a
  
• credit card or checking account number to
  verify
• or hold the scholarship
• Charge an up-front fee for a loan

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More
More Ways to Finance Your Education Hope
Scholarship Tax Credit A direct reduction of your
calculated tax for qualified out-of-pocket
expenses. Lifetime Learning Tax Credit A
percentage credit of 20 on the dollar not
available for those who qualify for the Hope
Scholarship Tax Credit, but still applicable for
students enrolled less than half time. Student
Loan Interest Deduction An above the line
deduction (does not have to be itemized) of up to
2,000 in the year 2000 and 2,500 for 2001 and
thereafter. Even more ways...
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More
Ways to Finance Your Education (continued) IRA
Early Withdrawal Provision for Education No
penalty for early withdrawal of IRA funds to pay
qualified educational expenses. Education
IRA Type of IRA in which contributions are made
until the beneficiary reaches the age of
18. Prepaid Tuition Programs Tuition costs are
rising at a faster pace than inflation so
starting this program at anytime can help reduce
costs. 529 Plans Allows students of any age and
their families to save money tax-free under
Section 529 of the Internal Revenue Code. Plans
vary from state to state.
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The End
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hesitate to contact the Member Services Department
at 1-800-FASTWEB. Students, to complete a free
Scholarship Search visit www.fastweb.com.
Educators, visit www.fastweb.com/educator to
find helpful resources, how-tos, and articles
for your students.
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